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Question CSOFP - TUNA

Tuna Bhd acquired a 70% stake in Dory Bhd and must now prepare a consolidated statement of financial position for the group. Key information includes: - Tuna Bhd owns 70% of Dory Bhd ordinary shares and 20% of its preference shares - There was a RM8 million increase in the fair value of Dory Bhd's non-depreciable land - Dory Bhd owes Tuna Bhd RM100 million and RM1.1 million for goods - Dory Bhd declared dividends of RM15 million and RM10 million but did not record the payable

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82 views1 page

Question CSOFP - TUNA

Tuna Bhd acquired a 70% stake in Dory Bhd and must now prepare a consolidated statement of financial position for the group. Key information includes: - Tuna Bhd owns 70% of Dory Bhd ordinary shares and 20% of its preference shares - There was a RM8 million increase in the fair value of Dory Bhd's non-depreciable land - Dory Bhd owes Tuna Bhd RM100 million and RM1.1 million for goods - Dory Bhd declared dividends of RM15 million and RM10 million but did not record the payable

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Ayunieazaha
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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QUESTION 1

The draft statements of financial position of Tuna Bhd and Dory Bhd as at 31 December 20X6 are as
follows:
Tuna Dory
Bhd Bhd
RM’million RM’million
Equity and Liabilities
Ordinary shares of RM1 each 560 250
10% preference shares of RM1 each 120 100
Other reserves 30 18
Retained profits 533 321
Long term Loan 228 112
Account Payables 137 99
1,608 900
Assets
Property, plant and equipment 720 505
Investment in Dory Bhd 420 -
Account receivables 350 270
Bank 50 30
Inventories 68 95
1,608 900

Additional information:

1. On 1 January 20X6, Tuna Bhd acquired 70% of ordinary shares in Dory Bhd for RM400 million
and 20% of its preference shares for RM20 million when Dory Bhd’s retained profits and other
reserves were RM149 million and RM13 million respectively. On that date, there was an excess
of fair value of non-depreciable land by RM8 million. The increase in fair value has not been
incorporated in Dory Bhd’s account.

2. There was 10% impairment on goodwill of Dory Bhd for the year ended 31 December 20X6.

3. Tuna Bhd sells goods to Dory Bhd at RM1.1 million on 28 December 20X6. The goods had been
sent to Dory Bhd as at that date, however it was only received by Dory Bhd at 4 January 20X7.
Tuna Bhd sells goods to Dory Bhd at cost plus 10%.

4. Trade receivables of Tuna Bhd include RM5 million due from Dory Bhd. This includes amount
due for inventory in note 3 above.

5. On 1 January 20X6, Tuna Bhd sold plant to Dory Bhd (cost RM30 million; accumulated
depreciation RM18 million) for RM15 millio n. The remaining life of this plant was 5 years. Plant
is depreciated using the straight line method.

6. RM100 million of the long term loan of Dory Bhd was a loan obtained from Tuna Bhd. Tuna Bhd
had included this amount as part of its account receivables.

7. At the end of the year, Dory Bhd has declared ordinary dividend of RM15 million and preference
dividend of RM10 million. However, Dory Bhd has not provide the dividend payable and Tuna
Bhd has not recognised its share of dividends from its subsidiary.

8. The policy of the group is to value the non-controlling interest at the proportionate share of the fair
value of the identifiable net assets of the subsidiaries on the date of acquisition.

Required:

Prepare a consolidated statement of financial position for Tuna Bhd Group as at 31 December 20X6.

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